NEW YORK -- Bruce Babbitt stared out the window of a corner office 24 stories above Fifth Avenue. To his left, Karen Kapler, a Florida-based political consultant working for his presidential campaign, was on the telephone tracking down a potential contributor. To his right, Muffie Meier, the campaign's deputy national fund-raising director, was doing the same.

Babbitt smiled wanly, muttering about "the absurdity of all this." He had just finished lunch in the conference room of the sleek offices of Ware Travelstead, a New York real estate developer and one of his supporters. Over lunch he had discussed "big issues with the best minds on Wall Street," Babbitt said. "Then I walk in here and beg someone for a thousand bucks."

A target located, Kapler handed the telephone to the former Arizona governor and long-shot Democratic presidential hopeful. The man and his wife had already given $250 each to the Babbitt campaign. The candidate's task was to squeeze another $750 each out of them, to get them to "max out" to the limit of a $1,000 contribution.

"Hello," Babbitt said cheerfully, using an easy first-name familiarity with his listener. "I'm in Manhattan, passing the tin cup . . . . "

This is how it is to run for president retail style.Among the 12 presidential candidatesin both parties, Babbitt's campaign is one of the poorest. As of Sept. 30, the latest period covered by Federal Election Commission (FEC) reports, his campaign reported $1.4 million in contributions, $35,973 in cash and $339,113 in debts. His candidacy has been kept afloat with $557,000 in loans from a bank in Phoenix.

The collateral for the loans is the federal matching funds that Babbitt will receive beginning in January. Most of the money will go right back to the bank, and the Babbitt campaign will remain strapped for cash as the marathon presidential campaign approaches the first true tests of strength in the Feb. 8 Iowa caucuses and Feb. 16 New Hampshire primary.

Massachusetts Gov. Michael S. Dukakis (D) should not have any loans to repay when his campaign receives a much larger infusion of federal matching funds. As of Sept. 30, the Dukakis campaign reported $7.6 million in contributions, $4.2 million in cash and $280,066 in outstanding debts.

But even Dukakis' success as the leading Democratic fund-raiser pales in comparison to the top Republican, Vice President Bush, who reported $12.6 million in contributions, $4.8 million in cash and $570,241 in outstanding debts as of Sept. 30. Former secretary of state Alexander M. Haig Jr., low man on the GOP fund-raising totem poll, reported $898,190 in contributions, $86,348 in cash and $100,377 in outstanding debts.

At this stage, the rich get richer. Since the Sept. 30 report, the Bush campaign estimates it has taken in an additional $5 million and expects to raise a total of more than $18 million by the end of the year. Senate Minority Leader Robert J. Dole (R-Kan.) raised $7.7 million by Sept. 30 and claims an additional $4 million since then. Dukakis raised $1 million in October and is easily over $9 million in total receipts, with several major fund-raising events still to come, according to campaign aides.

Other campaigns, however, are being stretched, joining Babbitt in the line of borrowers. Among those who have been forced to borrow because of cash flow or deeper problems are Rep. Richard A. Gephardt (D-Mo.), Sen. Paul Simon (D-Ill.), Haig, Republican Marion G. (Pat) Robertson and Rep. Jack Kemp (R-N.Y.).

Republicans historically have been more successful at political fund-raising than Democrats and this year is no exception. As of Sept. 30, Bush and Dole had raised a total of $20.2 million between them, $2.3 million more than the combined fund-raising of the six Democratic contenders -- and the gap is probably widening.

At least three factors appear critical to fund-raising in presidential campaigns and are illustrated by the success of Bush and Dole. One is the perception that the candidate has a good chance of being nominated. Bush and Dole appear so far ahead of their rivals that the GOP contest is coming to be seen as a two-man race long before the first votes are counted.

In contrast, the Democratic picture remains extraordinarily muddled, making it more difficult to pick a likely winner. For the purpose of pre-election year fund-raising, it doesn't matter much whether these perceptions turn out to be accurate.

A second factor is incumbency. Bush holds the nation's second-highest elective office and Dole, if not elected president, will remain a powerful senator. The Democratic field includes only one officeholder with a strong, established fund-raising base, Dukakis, who still will be a governor if he loses the presidential race. Babbitt is out of office. Jesse L. Jackson has never held office. Although Gephardt has risen high in the House Democratic leadership, neither he nor any of the other Democrats can rival Dole's position at the center of power on Capitol Hill.

Finally, Bush, 63, and Dole, 64, have a combined 58 years in national Republican politics beginning with their elections to the House in the 1960s. Both are former Republican National Committee chairmen and both have either held or run for national office before. In the course of their careers, they have worked tirelessly for the GOP and its candidates, accumulating political and personal debts that are now being called in.

The Democratic candidates are younger, less well known and less well connected to party leaders. This is not exactly, to use one of the political world's sports metaphors, "a level playing field," and all of these factors are reflected in the candidates' fund-raising. Money is more than the fuel that drives presidential campaigns. Long before the first votes are cast, money -- or its absence -- has helped to shape the strategies, styles and internal dynamics of the campaigns, and begun to separate the candidates into those who are perceived as "viable" contenders -- and therefore perhaps worth a maximum contribution -- and those who are not.Democrat With National Campaign

"What will $8 million buy you?" asked Bob Farmer, Dukakis' campaign treasurer and chief fund-raiser. "We have offices in 38 cities. We have 240 paid staff, 14 in Florida and Texas, 10 in North Carolina, 18 in Minnesota. We're the only Democratic candidate with a national campaign."

"There is also the advantage of time," he added. "We can get started three or four months earlier {in the March "Super Tuesday" primary and caucus states that follow Iowa and New Hampshire}. We have our act together."

In style at least, the Dukakis operation is beginning to take on something of the look and the insulation of a full-blown, national presidential campaign on the march. On a recent trip to Texas, Dukakis and his aides flew in a chartered jet from Dallas to College Station to Austin while three reporters chased the candidate in a twin-engine prop aircraft, also arranged by the campaign.

At Texas A&M University in College Station, Dukakis was surrounded by about a dozen aides, including an advance party that had smoothed the way. Watching his boss answer questions from students, Nick Mitropoulos, Dukakis' executive assistant, expressed awe over how the campaign's fund-raising prowess had allowed it to buy the technical expertise that was beaming the event by satellite television to 50 other colleges in 25 states.

Meanwhile, Babbitt told a small audience of supporters in New York that "I get off a {commercial} plane occasionally carrying my own bag not because I want to emulate Jimmy Carter but because no one is with me." At the national campaign headquarters in Phoenix, Babbitt aides track the accumulating "frequent flyer" miles, celebrating whenever the candidate earns a free trip.

If the well-financed candidates are already embarked on national campaign extravaganzas, Babbitt is running a two-state sideshow. More than 75 percent of his spending was allocated to Iowa and New Hampshire. Of the three other states where the Babbitt campaign reported spending, two border Iowa.

It was the lack of cash -- which has turned out to be even worse than anticipated -- that dictated the two-state strategy, just as it dictated the dispatch of Chris Hamel, one of Babbitt's top aides who ordinarily might have a lofty title and broad responsibilities in Phoenix, to Des Moines more than a year before the caucuses.

"Every dime we get is going in there {Iowa}," said Elaine Kamarck, deputy campaign manager for Babbitt. "We're going to have as much money there as anyone."

Kamarck has now seen presidential politics from both ends of the fund-raising barrel. In 1984, she worked in former vice president Walter F. Mondale's Democratic campaign, which, like the Bush operation today, wallowed in contributions.Consequences of Political Money

The differences, she said, are mostly on the national level, not in the first two critical states. For her, it means staying in the houses of supporters, not fancy hotel rooms; it means dealing largely with volunteers, so that "you can't have your ordinary temper tantrums, working with people who are doing it for love, not money," and it means scrambling for the meager resources that are left after Iowa and New Hampshire take their cuts.

"I called Iowa recently with sugar dripping out of my voice to ask them to send 50 bumper stickers to Ohio," Kamarck said.

Beyond strategy and style, political money has real political consequences, at least until the first votes are counted. The size of a campaign treasury is one of the few measurable commodities before voting starts. The ability to raise large amounts of cash in contributions of $1,000 or less gives a candidate instant credibility, which leads to heavier press coverage of the campaign, which leads to more contributions.

"Money begets money," said Robert Beckel, Mondale's campaign manager, who argues that "money is far more important in the early preliminaries, before the voters get in it, than it is after the voters get in."

"It's a self-reinforcing problem," said Kathy Bushkin, who was Gary Hart's press secretary in 1984. "If you don't have money, you can't do the things that help you get money. If you can't prove the campaign is moving, it's hard to convince people to give."

Bob Farmer understood this psychology. He turned first to Dukakis' Massachusetts network. "I sat down with 300 people, one on one for an hour, and asked them, 'Would you exercise your network for Michael Dukakis?' " he said. "The secret is the number of gray-haired people willing to get committed. There are a lot of 22-year-old fund-raisers. We have a lot of people with pot-bellies and little or no hair."

Two-thirds of Dukakis' initial contributions came from Massachusetts, a far more congenial fund-raising location than Babbitt's base in sparsely populated, Republican-dominated Arizona. Dukakis also turned to his unique ethnic base among his fellow Greek Americans, who have provided more than 15 percent of his campaign funds.

The result, contained in the Dukakis' campaign's first FEC report for the period ended June 30, was $4.6 million in contributions, triple the collection rate of his nearest Democratic fund-raising rival. Dukakis was off and running.

Just the opposite psychology took hold in the Babbitt campaign. After clearing $750,000 from a dinner in Phoenix in February, its next largest event, in Connecticut in June, netted $30,000, according to Lauren Post, the campaign's national fund-raising director. Money was already tight when the Democratic candidates gathered in Houston July 1 for their first nationally televised debate, where Babbitt's awkward performance earned him the media title of the evening's biggest loser.

"The Houston thing haunted us for months," Post said.

After Houston, Babbitt was firmly entrenched in the bottom tier of the Democrats and sometimes simply left out of media accounts of the race or assumed to be not long for the campaign.

The disaster was written in the third quarter FEC report for all to see. Between July 1 and Sept. 30, Babbitt reported $551,815 in contributions, while Dukakis scooped up $3.4 million and the four other Democrats reported contributions of more than $1 million each.

The reality was even worse. Of the contributions Babbitt claimed -- $262,000 -- was the second of the three loans his campaign has received and $35,000 came out of his own pocket. Babbitt, one of the wealthiest of the Democratic contenders, and members of his immediate family have given $50,000 to the campaign, the maximum allowed by law. The real total of third quarter contributions to Babbitt's presidential quest was $249,358.

"Everybody thought he was a loser, that it would be throwing money away," Post said of this low point. "It was very discouraging. It was frustrating. People often thought he wasn't worth $500."

When Babbitt first started running for president months ago, he said he viewed the campaign as a great "national seminar" in which, at worst, he would learn a great deal about the country. He has learned about the intricacies of agricultural policy in the Midwest, the chemical composition of acid rain in the Northeast, the technical capabilities of nuclear weapons systems.

He also has learned a few things about the more mundane aspects of life.

"I'm learning things I never knew when I had a secretary when I was governor," Babbitt said. "Four out of every five phone calls you make, the person is not there. If you don't have a place where the phone call can be returned, you waste an enormous amount of time."

It was this realization, plus the increasingly desperate fund-raising situation, that led to a change in tactics and brought Babbitt to Travelstead's midtown Manhattan office late last month. Instead of trying to raise money on the run -- popping in and out of airport telephone booths between flights -- since late summer Babbitt, operating out of a fixed base, has devoted one or two days a week almost exclusively to fund-raising.

While Farmer is planning a major fund-raising dinner for Dukakis here next Wednesday, Babbitt has no choice but to continue with what he calls "root-canal therapy," going one-on-one with potential contributors of from $250 (the maximum contribution the federal government will match) to the $1,000 total limit. Michael McCurry, his press secretary, estimates that it takes $90,000 to $120,000 a month just to keep the campaign alive. Babbitt must raise about half that amount, much of it on the telephone.

"There's no substitute for the candidate asking," Kapler said. "It's so much easier to say no to somebody else."

On Babbitt's first afternoon in New York, Kapler and Meier, the deputy fund-raising director, placed 105 telephone calls across the country. Babbitt talked to 30 people, and others called back the next day. He worked off a list prepared by his staff with the names of potential contributors, what they do, how much they have given in the past, perhaps a personal note such as friendship with Babbitt's wife, Hattie.

The take for the first afternoon's work is more than $10,000 in individual commitments and promises to raise $35,000 in addition. That night, at a cocktail party in a Park Avenue apartment, Babbitt raised $1,500.'I Think I Have a Good Shot'

Since so much of political fund-raising at this stage is psychological, Babbitt is relentlessly optimistic on the telephone. He brags often about his Iowa and New Hampshire organizations.

"Hi, Larry," the candidate says to a Texas lawyer. "Pretty good. We've had a couple good weeks. Things are moving . . . . I need 1,000 people to provide me with a thousand bucks. I understand. Let me make a counteroffer. The first $250 is matched by the federal government . . . . I really do have a message. I think I have a good shot."

Babbitt gets the $250 pledge and has other successes. A prominent New York investment banker pledges $1,000 and the check is in Meier's hands an hour later. But fund-raising is an acquired skill for Babbitt, as it is for many politicians, and he still needs coaching.

"And his wife. What about his wife?" Meier whispers urgently as the candidate winds up a conversation with a contributor.

In another call, Babbitt doesn't even get around to asking for money as he chats with a high school classmate of his wife.

"It's the first time I finked out on you all day," he says sheepishly to Meier and Kapler. "It wasn't a big money call."

"It's the second time, but that's okay," Kapler replies.

In the last three months of 1983, Hart's presidential campaign raised $330,130. In March 1984, after Hart had finished a distant second to Mondale in Iowa and first in New Hampshire, the same campaign took in $8.2 million in one month.

"I would exchange the momentum of a good finish in Iowa for $10 million," said Beckel, speaking from the perspective of the battered Mondale campaign that barely survived Hart's unexpected challenge in 1984.$10 Million as 'Small Change'

Next year, after the New Hampshire primary comes Super Tuesday, mostly in the South, where the front-runners are already hard at work organizing. But Beckel argues that after the first two states "presidential politics is not a field business. It's a momentum, expectations and media business."

"Ten million dollars is small change when you're talking about 20 states," Beckel said. "We had all that much money going in and we were broke after the New Hampshire primary . . . . It's important and good to have, but all the money these front-runners have won't be worth much if they lose in Iowa and New Hampshire."

"What saved Walter Mondale was not his money or his organization," Kamarck added. "What saved Mondale was 25 years as a real, true leader in the Democratic Party. You can't buy the kind of loyalty Mondale had."

Meanwhile, McCurry and other senior Babbitt aides are playing the underdog role to the hilt. It was the principal reason that they allowed a reporter to observe Babbitt in the decidedly unpresidential business of asking for money.

At this stage, it also helps to have a sense of humor, a quality that Meier, a gregarious woman, enjoys in abundance. Early one morning last week Babbitt met with some of his New York supporters. The discussion turned serious as Babbitt explained how he is trying to sharpen his campaign message. "I'm always searching for a metaphor, a parable," he said. "I'd rather have a crisp image than a $1,000 check."

At that, Meier collapsed against a nearby wall in mock exasperation.

"You're fired," she told the amateur fund-raiser and would-be president.Staff writer Charles R. Babcock and researcher Colette T. Rhoney contributed to this report.